Elliott Wave 5.0 Is a "Jailbroken" version of the Elliott Wave Principle. Understanding this is the "key" to applying the Elliott Wave Principle in all commodities and stock indices!
Every Elliott Wave Principle book published since 1978, is the "Non Jailbroken" version. The problem is, "all" ratio analysis in the Elliott Wave Principle does not reflect real world wave action.

Sunday, March 3, 2013

Crude Oil, Are The Crude Oil Bears In A Trap?

This is the April crude oil contract and it sure looks like a crash to me.

The angle is steep enough to fit the bill and last week oil created a long spike as well. All the bears will have protective buy stops in place, so oil could see a dramatic rise as all those bears instantly turn into bulls. Since the oil crash looks corrective then oil can travel to new highs in the next few months and oil should have no problem hitting $100 per barrel one more time. I have mentioned many times that oil may even see $115 per barrel and this may happen closer to the summer holiday and fall hurricane seasons.

Right now the gold/oil ratio is about 17:1. The higher the ratio the cheaper oil is to gold. When oil gets to the extreme side then anything 10:1 would be extreme.

The economists that are forecasting $5000 gold are also telling us that we are going to get $500 per barrel oil, even though they do not say that in print. It is silly to expect gold to go up without oil maintaining its ratio range.

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About Me

I am a fan of the Elliott Wave Principle from RN Elliott. He recognized the patterns without the help of computers and fancy software.
Doing Elliott Wave analysis with simple pen on paper keeps objectivity alive and forces us to think more in real time.
All wave analysis is done with time and pattern and not by price. Price is worthless information if the pattern is not recognized.
Stuck on the end of every wave pattern is a price and with time all patterns reverse. One of the best quotes I have read is from W.D. Gann
"Time is more important than price; when time is up price will reverse."
Wave analysis can also be used for much more than just financial charts as wave patterns show up in other natural recordings. When ever there is hype in one direction by a crowd, there is a very high chance that the hype is misplaced. The hype and fear about Y2K was one big example and "all" the hype and fear on AGW. Man made Global warming is the biggest fraud going today and you can tell just by looking at a few world temperature charts.